Syngenta announced yesterday (February 3) that ChemChina had offered to acquire the company in a cash deal of US$ 465 per ordinary share. Syngenta chairman Michel Demaré said that the Syngenta board is unanimously and enthusiastically recommending the offer to shareholders.
In the public health pest control sector Syngenta is known for leading brands such as Advion, Demand CS and Talon. Readers may be aware that Syngenta was the subject of a hostile bid by USA-based Monsanto last summer. Syngenta’s name had also been linked to the Dow DuPont merger (described as a merger of equals) which went ahead last December.
|Unlike the Monsanto bid, this offer from ChemChina is entirely in cash. You can watch what Syngenta’s chairman, Michel Demará© said about the benefits of the ChemChina offer in a CNBC interview here.|
|The official press statement stated:
“ChemChina has offered to acquire the company at US$ 465 per ordinary share plus a special dividend of CHF 5 to be paid conditional upon and prior to closing. The offer is equivalent to a Swiss franc value of CHF 480 per share1. Syngenta shareholders will in addition receive the proposed ordinary dividend of CHF 11 in May 2016.
The Board of Directors of Syngenta considers that the proposed transaction respects the interests of all stakeholders and is unanimously recommending the offer to shareholders. There is committed financing for the deal and a strong commitment to pursue regulatory clearances. A Swiss and U.S. tender offer will commence in the coming weeks and the transaction is expected to conclude by the end of the year.
Syngenta’s existing management will continue to run the company. After closing, a ten member Board of Directors will be chaired by Ren Jianxin, Chairman of ChemChina, and will include four of the existing Syngenta Board members. ChemChina is committed to maintaining the highest governance standards with a view to an IPO of the business in the years to come.
Michel Demará©, Chairman of Syngenta, said: “In making this offer, ChemChina is recognising the quality and potential of Syngenta’s business. This includes industry-leading R&D and manufacturing and the quality of our people worldwide. The transaction minimises operational disruption; it is focused on growth globally, specifically in China and other emerging markets, and enables long-term investment in innovation. Syngenta will remain Syngenta and will continue to be headquartered in Switzerland, reflecting this country’s attractiveness as a corporate location.”
John Ramsay, Chief Executive Officer, said: “Syngenta is the world leader in crop protection having significantly increased its global market share over the last ten years. This deal will enable us to maintain and expand this position, while at the same time significantly increasing the potential for our seeds business. It will ensure continuing choice for growers and ongoing R&D investment across technology platforms and across crops. Our commitment to cost and capital efficiency will remain unchanged.”
Ren Jianxin, Chairman of ChemChina, said: “The discussions between our two companies have been friendly, constructive and co-operative, and we are delighted that this collaboration has led to the agreement announced today. We will continue to work alongside the management and employees of Syngenta to maintain the company’s leading competitive edge in the global agricultural technology field.” He added: “Our vision is not confined to our mutual interests, but will also respond to and maximize the interests of farmers and consumers around the world. We look forward to Michel Demará© remaining on the Board as Vice Chairman and lead independent director, and to working with John Ramsay and the management and employees of Syngenta to deliver safe and reliable solutions for the continued growth in global food demand.”